ILNews

Attorneys cannot agree to settlements for clients

Jennifer Nelson
January 1, 2007
Keywords
Back to TopCommentsE-mailPrintBookmark and Share
The fact a party authorizes an attorney to enter settlement negotiations and knows the negotiations are occurring does not mean that the attorney has authority to approve a settlement, according to a ruling today by the Indiana Court of Appeals.

In Carol and David Bay v. Michael Pulliam and Cardinal Transportation, LLC, 49A05-0612-CV-704, the Court of Appeals reversed a Marion Superior Court decision that granted a motion to enforce settlement agreement in favor of Pulliam and Cardinal Transportation. At issue was whether a settlement between an attorney for the Bays and Pulliam's insurance company could be binding if the Bays did not agree to it.

Carol Bay was injured during a vehicle accident involving a Cardinal truck driven by Pulliam. The company and Pulliam were insured by Zurich Insurance, North America. The Bays hired the Nunn Law Office to represent them. The settlement negotiations were between the Nunn office and Zurich, which through correspondence disclosed various settlement demands and offers of settlement from Zurich. Attorney Ken Nunn signed each demand letter, and Zurich was told to contact Claims Manager Jeff Pryor to discuss settlement. On Jan. 3, 2006, Pryor communicated with Zurich advising, "Our client has accepted your offer in the amount of $16,700." A release form was then forwarded from Zurich to the Nunn office.

Carol Bay testified in court that on Jan. 2, 2006, she told Dean Arnold, another attorney in the Nunn office, that she needed to consult with her husband before accepting the settlement offer. When the Bays received the settlement offer on Jan. 17, 2006, they rejected it in writing by noting the rejection of the settlement in two separate locations.

The Bays appealed the motion to enforce settlement agreement, arguing that the "attorney for the Bays" did not have actual or apparent authority to make the settlement agreement. They conceded the law office could enter into settlement negotiations and also that the Bays knew of such negotiations, but not that Nunn's office could agree to any settlement. The Court of Appeals agreed with the Bays argument, stating there was no evidence that Carol Bay told Arnold to accept the Zurich offer.

Pulliam maintained that Arnold had authority to enter the binding agreement per the conversation between himself and Bay on Jan. 2, in which she said she wanted to "settle the case." That is not evidence that she accepted the offer or gave Arnold authority to do so, the court ruled.

Senior Judge Sullivan wrote in the opinion, "The law is clear that retention of an attorney by a client does not constitute implied authority to settle a claim nor does it constitute a manifestation to third parties that the attorney has apparent authority to do so in an out-of-court proceeding."

Citing Gravens v. Auto-Owners Ind. Co., 666 N.E. 2d 964 (Ind. Ct. App. 1996), the court wrote, an attorney may not settle a claim without the client's consent.

In this case, Zurich assumed the Nunn office had the authority to approve the settlement, when it in fact did not, the court ruled. The acceptance of the settlement by the claims manager in the Nunn office was not binding upon the Bays. The Court of Appeals reversed the order of the Marion Superior Court and remanded for further proceedings.
ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. Or does the study merely wish they fade away? “It just hasn’t risen substantially in decades,” Joan Williams, director of the Center for WorkLife Law at the University of California Hastings College of the Law told Law360. “What we should be looking for is progress, and that’s not what we’re seeing.” PROGRESS = less white males in leadership. Thus the heading and honest questions here ....

  2. One need not wonder why we are importing sex slaves into North America. Perhaps these hapless victims of human trafficking were being imported for a book of play with the Royal Order of Jesters? https://medium.com/@HeapingHelping/who-are-the-royal-order-of-jesters-55ffe6f6acea Indianapolis hosts these major pervs in a big way .... https://www.facebook.com/pages/The-Royal-Order-of-Jesters-National-Office/163360597025389 I wonder what affect they exert on Hoosier politics? And its judiciary? A very interesting program on their history and preferences here: https://www.youtube.com/watch?v=VtgBdUtw26c

  3. Joseph Buser, Montgomery County Chief Prosecutor, has been involved in both representing the State of Indiana as Prosecutor while filing as Representing Attorney on behalf of himself and the State of Indiana in Civil Proceedings for seized cash and merchandise using a Verified Complaint For Forfeiture of Motor Vehicle, Us Currency And Reimbursement Of Costs, as is evident in Montgomery County Circuit Court Case Number 54C01-1401-MI-000018, CCS below, seen before Judge Harry Siamas, and filed on 01/13/2014. Sheriff Mark Castille is also named. All three defendants named by summons have prior convictions under Mr. Buser, which as the Indiana Supreme Court, in the opinion of The Matter of Mark R. McKinney, No. 18S00-0905-DI-220, stated that McKinney created a conflict of interest by simultaneously prosecuting drug offender cases while pocketing assets seized from defendants in those cases. All moneys that come from forfeitures MUST go to the COMMON SCHOOL FUND.

  4. I was incarcerated at that time for driving while suspended I have no felonies...i was placed on P block I remember several girls and myself asking about voting that day..and wasn't given a answer or means of voting..we were told after the election who won that was it.

  5. The number one way to reduce suffering would be to ban the breeding of fighting dogs. Fighting dogs maim and kill victim dogs Fighting dogs are the most essential piece of dog fighting Dog fighting will continue as long as fighting dogs are struggling to reach each other and maul another fih.longaphernalia

ADVERTISEMENT